Riccitiello says Madden NFL 10 sales are “discouraging”

EA CEO John Riccitiello has stated in a memo that Madden NFL 10 sales are “discouraging”, and he is disappointed that “one of our highest-rated and best-marketed ‘Madden’ titles in years is facing strong headwinds” during its debut.

No word yet on what the sales figures were has been revealed yet, as the NPD numbers have yet to be released; however, as of October of last year, Madden NFL 09 has sold 4.5 million copies.

The Wall Street Journal has posted the memo in full, and we have it for you after the break.

As we head into the fall of 2009 and prepare for the all-important holiday quarter, I wanted to send a note to get everyone up to date on our progress.

We had a strong first quarter for FY10 headlined by great product quality and strong marketing. Our two biggest titles in the quarter, The Sims 3 and EA SPORTS Active, broke through and beat our own high expectations. And, just as important, our total direct-to-consumer businesses were up 38% in our first quarter.

We’re still in the middle of our second quarter, with a few of our biggest launches – Need For Speed SHIFT and FIFA 10 – still coming later this month. Today, we launched The Beatles: Rock Band. These games are all outstanding and will delight millions of consumers this year.

Last month at the Games Convention in Germany, EA put on a dazzling display of industry leadership. BioWare’s Star Wars: The Old Republic won the top honors at the convention from Eurogamer. We launched Madden NFL 10, which critics and fans alike reviewed as the best Madden on this generation of consoles. In my judgment, we supported this game with one of the strongest marketing campaigns of the year. Both the game quality and marketing reflect outstanding teamwork and deep commitment to excellence.

This week, market research for August will show that year over year, the industry was down in North America – and that August sales of Madden NFL 10 are down with that trend. It is discouraging that one of our highest-rated and best-marketed Madden titles in years is facing strong headwinds.

Despite the challenging environment in North America, there are a few important and positive signs in our sector. In recent weeks, both Sony and Microsoft announced significant price cuts for the Playstation 3 (the new slim) and Xbox 360. Our early read on the market is that consumers are responding and console sales are up significantly, particularly for the Sony platform where EA has historically performed well. This is encouraging, as greater hardware sales have historically translated to stronger software sales. We’re hopeful that the Madden sales trend will strengthen as more consumers go to retail to pick up their lower-priced consoles.

Also, our EAi businesses, comprised of Pogo, the new EA Social group and EA Mobile, are performing well. The Pogo Puppies social game goes live next week. On mobile, a recent analysis of the Apple App Store games show that EA is number one with the highest number of titles in the top 100 – and with the highest average price point.

What underpins most everything is the dramatic improvement in our product quality. Back in 2006, we set quality as a top priority and we have increased our average every year since then. Already this year, EA has produced 11 titles with an 80+ Metacritic average:
– Madden NFL 10
– Fight Night Round 4
– EA SPORTS Active
– Tiger Woods PGA TOUR 10
– NCAA Football 10
– BOOM BLOX Bash Party
– The Sims 3
– Battlefield 1943
– Skate 2
– Henry Hatsworth in the Puzzling Adventure
– The Beatles: Rock Band

I am confident that we will exceed the record we set last year of shipping 14 titles rated 80 or better. We will know in the weeks ahead when critics rate our big releases such as NHL 10, FIFA 10, Need for Speed SHIFT, Dead Space Extraction, and from EAP, Brutal Legend and Left 4 Dead 2.

We are now five months into the fiscal year and the most important period of the year is still in front of us. Trend lines for the industry present a challenge, but our strategy and execution give me confidence. From here, our focus is on four priorities: great product launches, succeeding on the Nintendo Wii, continued expansion of our direct-to-consumer business, and cost control.

In any economy, this is the path to success.

Let me finish by thanking all of you for your hard work and, most of all, for your success in creating and delivering the very best games consumers can play.

John

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